Minister: Services to constitute 60% of Malaysia GDP by 2020

by **Cals** Fri 11 Apr 2014, 01:28

Business & Markets 2014

Written by Bernama

Thursday, 10 April 2014 15:23

KUALA LUMPUR (Apr 10): The services sector will contribute 60 per cent to the Gross Domestic Product (GDP) by 2020, making it a major contributor to Malaysia's economy, said International Trade and Industry Minister Datuk Seri Mustapa Mohamed.

Currently, the services sector accounts for 55 per cent of the country's GDP.

"We have less than six years to achieve this. We need to do something radical to invigorate the services sector. It has done well, growing faster than other sectors but that is not enough," he told reporters after Malaysia Services Development Council 1/2014 meeting here today.

Also present at the meeting were Pemandu (Performance Management & Delivery Unit) Chief Executive Officer Datuk Seri Idris Jala and representatives from the various ministries, agencies and services industries association.

Mustapa said the council was briefed, among others, on the progress of the services sector liberalisation initiative at the Asean level as well as presentation on the logistics industry.

"We're monitoring the progress and considering to do an impact study on capacity building, investment and work force usage after the sector liberalisation.

"We also want to know whether our companies managed to penetrate other markets or still having difficulties," he said.

Mustapa said efforts were also being undertaken to intensify promotion of services with higher export potential that include oil and gas, maintenance, repair and overhaul (MRO), creative design, electrical manufacturing services and ICT (information and communications technology) services.

A total of 147 trade promotion activities have been planned for 2014 with 45 programmes focusing on services sectors targeting traditional and new growth markets.

In 2013, contribution from the services exports to Malaysia's total exports of goods and services was 15.4 per cent or RM125.47 billion compared with 14.3 per cent or RM117.01 in the previous year.

Meanwhile, Mustapa said Asean had completed negotiations on the Ninth Package of Asean Framework Agreement of Services (Afas), which would be signed during the 46th Asean Economic Ministerial Meeting in August.

Under the Ninth Package, Malaysia offers 102 sub-sectors for liberalisation.

The final 10th Package negotiation is targeted for completion and signing by end-2015.